ESG round-up: Old Mutual and Ninety One to vote against Sasol decarbonisation plans

South African-based investors Old Mutual and Ninety One have predeclared their intention to vote against Sasol’s decarbonisation pathway, which the South African energy giant is putting to shareholders on Friday via an advisory vote. Old Mutual is also voting against Sasol’s remuneration report and the re-election of director Muriel Dube. Citing the repeated lack of targets, Old Mutual described the climate vote as a “step backwards” and “not aligned to the initial objective of the resolution put forward in 2019, which was to encourage improved performance with respect to climate impact.” Ninety One, which is a supporting investor on the company as part of CA100+, wrote that there is “still too much uncertainty and lack of momentum around the implementation of the strategy, particularly the uncertainty around gas supply and a clear alternative.”

Sasol has pushed back, describing the vote by Old Mutual and others as perplexing. “We consider the motivation advanced by Old Mutual for this recommendation to be flawed and underpinned by conjecture,” it said in a statement on Monday. The company also noted that influential proxy advisor ISS is backing all of its resolutions. But its rival Glass Lewis has recommended an abstain on the vote on the decarbonisation pathway, stating that there is “insufficient disclosure concerning engagement with shareholders on this vote.”

Mirova is looking to double its AUM by 2030, according to CEO Philippe Zaouati. The French sustainable investment house currently manages €28.4 billion in assets, and has had €1 billion of net inflows so far in 2023. In a LinkedIn post, Zaouati said the ESG boutique is targeting more than €60 billion by 2030, and wants to double its assets in Asia and North America to 30 percent. He said the firm’s growth plans include opening new offices in Latin America, launching new products, including a private equity strategy on societal transformation, and increasing the weighting of unlisted assets in its products.

Brazil raised $2 billion from its debut in the green bond market in a hotly anticipated deal on Monday that saw orders from 240 investors, three-quarters of whom were European and North American. Around 60 percent of the bonds were allocated to asset managers. The Brazilian finance ministry said the bonds, which yield 6.5 percent, saw the lowest spread in a new issue in almost a decade, and that it would look to allocate at least 75 percent of the proceeds to new projects.

The Platform Living Wage Financials – an investor coalition boasting LGIM, Columbia Threadneedle and Amundi among its members – has made a series of recommendations to fashion brands sourcing from Bangladesh in light of clashes over minimum wage. Earlier this month, the Bangladesh Minimum Wage Board announced a new minimum wage of 12,500 taka per month ($113; €105). However, according to investors, this “proposed new minimum wage falls significantly short of the 23,000 taka minimum that garment workers and unions are united in calling for”. In response, the group is asking companies to support worker demands to raise minimum wage, publicly condemn alleged violence against “peacefully protesting workers and unions”, and commit to absorbing the increased cost of wages in their “purchasing price and committing to sourcing from Bangladesh after the minimum wage increase”.

Robeco has launched its Fashion Engagement Equities Strategy, the first strategy in the market focused exclusively on fashion, according to the asset manager. The Article 8 fund will invest in and engage with 30-40 publicly listed companies across the fashion value chain, from sourcing to production, consumption and end-of-life. Robeco said the team will conduct tailored multi-year engagements on key sustainability challenges.

There should be no monetary policy scenario that ignores climate change, according to the Bank of England’s Catherine Mann. In a speech on Monday, the economist said “from a monetary policy perspective, there is no ‘no climate change’ scenario to fall back on”, adding that it will not be business as usual if the world does not limit global warming to “well below 2 degrees”. Mann said more research is essential for monetary policymakers to better understand and model the risks and policies linked to climate change. She added that, while there are differing opinions on the role central banks should play in achieving climate change objectives, with some banks having climate change policies in place and some not, “when climate change has macroeconomic effects… it becomes a concern for monetary policymakers”.

Moody’s has released a framework for net-zero assessments (NZAs). NZAs indicate Moody’s opinion of the strength of an entity’s carbon emissions reduction profile relative to a global net-zero pathway, consistent with the most ambitious goals of the Paris goals and takes into account all GHG emissions. The framework applies to non-financial corporate entities globally, including public sector and non-profit entities.

ESG investing remains a high priority for defined contribution (DC) members, according to research from LGIM. The study of 4,000 members found that nearly 75 percent of DC members would be willing to pay higher fees for increased exposure to ESG private market assets, if they can deliver proof of performance. There was high demand for exposure to renewable energy infrastructure, followed by social investments such as investing to build affordable homes and create local jobs. The research also found that 93 percent of Gen Z members want to see their pension reduce its exposure to fossil fuels, while 55 percent of surveyed members want to see their pension provider engaging with companies on improving their environmental practices.

The Japan Exchange Group (JPX) has launched an ESG data hub (JPX Listed Companies ESG Information Web) in collaboration with Datazora, a company that collects and disseminates a wide range of listed company information. The system is being used by listed companies, investors and other actors. The website provides a list of links to ESG-related information disclosed by companies listed on the Tokyo Stock Exchange, including ESG-related news and ESG reports. JPX said it hopes that this will make companies’ ESG-related information accessible to a wider range of investors and shareholders without increasing workload.